WMDC transfers its 27% stake in Maharashtra Scooters to Bajaj - What's the complete story?

In a major development, WMDC has transferred its 27% stake in Maharashtra Scooters Limited (MSL) to Bajaj Holdings & Investment Limited on 17th June 2019. Consequent upon the acquisition of 27% stake of MSL from WMDC, the Company (BHIL) holds 51% shareholding in MSL.  MSL has hence become a subsidiary of BHIL with effect from 17 June 2019.  A statement has been released by Bajaj in this regard. Here is the FULL TEXT and the complete story behind the development:-

"Maharashtra Scooters Limited (MSL), which was incorporated on 11 June 1975, as a joint sector company promoted by erstwhile Bajaj Auto Ltd. (BAL) & WMDC Ltd, a Government of Maharashtra undertaking, had started manufacturing of geared scooters from 13 August 1976, in technical know-how / collaboration with erstwhile BAL. 

"With the gradual shift in consumer preferences from geared scooters to the motorcycles, the Company discontinued production of geared scooters effective 1 April 2006. The manufacturing activity of the Company is currently restricted to the manufacture of pressure die casting dies, jigs and fixtures, primarily meant for two and three - wheeler industry.

MSL is today a Core Investment Company, not requiring registration with RBI. 

Having achieved the broad objectives of the joint sector project, WMDC had in 2003 offered to sell its 27 per cent shareholding in MSL and Bajaj Holdings & Investment Ltd (BHIL & erstwhile BAL) had confirmed its willingness to purchase these shares. 

Since WMDC & Bajaj Auto Ltd. could not agree on a price, the price at which the shares were to be sold had been jointly referred to a sole. 

Arbitrator, Justice Arvind V Savant (Retd). The Award of the Arbitrator dated 14 January 2006 valued the share price of MSL at Rs. 151.63 per share as the rate at which 3,085,712 equity shares of MSL held by WMDC were to be sold to the Company. 

The said Award was challenged by WMDC in the Bombay High Court.

The Division Bench of the Bombay High Court had pronounced its judgment in the matter on 8 May 2015. 

A Special Leave Petition (SLP) was then filed by WMDC in the Supreme Court against the above Order.

After hearing both the parties, Supreme Court passed an order dated 9 January 2019, dismissing the Special Leave Petition filed by WMDC and directed that:

“BHIL (i.e. the Company) shall pay to WMDC an amount of Rs. 232 per Share in place of Rs.151.63, along with interest @ 18% p.a. from the date of the award (i.e. 14 January 2006). No sooner the afore-said payments due are made, the shares shall be transferred to BHIL.”

BHIL made the necessary payment to WMDC by way of cheques on 14 January 2019.

WMDC has transferred its 27% stake in MSL to the Company on 17 June 2019.

Consequent upon the acquisition of 27% stake of MSL from WMDC, the Company (BHIL) holds 51% shareholding in MSL.  MSL has hence become a subsidiary of BHIL with effect from 17 June 2019."